No love for the Greenback this week as U.S. economic data was arguably net negative, coronavirus cases continued to rise, and the next highly needed U.S. stimulus deal remained uncertain.
United States Headlines and Economic data
No major U.S. updates but we saw USD weakness on Monday, likely due to positive global risk sentiment. Traders were starting the week on good vibes, likely on a mix of stories including optimism of a EU Recovery fund deal, and another positive COVID-19 vaccine update, this time from the joint project between Oxford and AstraZeneca.
Dollar weakness accelerated on Tuesday on more positive global risk sentiment vibes, especially after the EU finally gets a deal done on the recovery fund and on positive expectations the U.S. will also get a new stimulus package soon. We also saw more evidence that COVID-19 cases growth is accelerating in the U.S. (California COVID-19 cases top 400,000, soon to overtake New York as worst-hit state, Nation’s Deaths Pass 140,000)
Despite positive housing data during the U.S. session, USD weakness continued, possibly with additional help for the bears from rising tensions between the U.S. and China (U.S. charges two Chinese nationals in coronavirus vaccine hacking scheme, U.S. gives China 72 hours to shut Houston consulate)
A small bounce for the Greenback on Thursday as broad risk sentiment shifted negative after the U.S. weekly jobs update, but it was short-lived as traders likely continued pricing in the massive Federal Reserve stimulus measures, uncertainty with the next U.S. stimulus package and more political tensions between the U.S. and China.
No end of week recovery for USD on Friday despite improving U.S. economic data and broad risk-off sentiment from Thursday flowing into Friday.